Cook's Markets Purchases Laurel Pantry Pride Lease

Cook's Supermarkets, the small Hyattsville food chain, today purchased the lease of the Pantry Pride store in Laurel and promised to rehire as many employes of the bankrupt Pantry Pride as it could.

Cook's $185,000 purchase came during the first of two days of an auction of 49 Pantry Pride leases on stores in Maryland and Delaware. The auction was conducted before U.S. Bankruptcy Court Judge John J. Galgay.

Giant Food Inc. of Landover, which spent $1 million to buy the lease of a failed Pantry Pride on Patapsco Avenue in Baltimore, lost a hard bidding battle for a store in Westminster, Md., to a near namesake, Giant Food Stores Inc. of Carlisle, Pa.

Giant of Landover made several stabs at convincing Galgay to accept lower offers than the Carlisle company made, citing the Maryland firm's willingness to rehire as many Pantry Pride employes as it could at the Baltimore store. David Feinstein, attorney for the Carlisle Giant, would not guarantee that his firm would make a special effort to rehire the laid-off workers.

Responding to a question by Galgay, Feinstein said "we are an equal opportunity employer. We will interview all applicants and hire those people who are qualified."

"Now that's a little vague," Galgay retorted.

"We feel it is quite equitable," Feinstein replied.

Galgay had said earlier that if two bids for a lease were identical, he would look at a bidder's willingness to rehire former employes in deciding which equal bid to accept.

The Carlisle food chain -- which operates stores in Pennsylvania under the name Giant and in Hagerstown, Md., and Martinsburg, W. Va., under the name Martin's -- began the bidding for the Baltimore store at $500,000, $250,000 less than the price Pantry Pride wanted. Weis Markets of Sunbury, Pa., stayed in the bidding for awhile, but by the time the exchanges reached $700,000 it was a fight between the two Giants.

When Jim Lemmon, vice president of the Carlisle Giant, bid $1.15 million for the lease, David Rutstein, general counsel for the Landover firm, only matched the bid and then asked Galgay whether the Carlisle concern "will respond on the union question," that is, whether it would rehire the unionized former Pantry Pride employes.

The Landover firm said it would hire as many former workers as it could.

Galgay ruled that he would not consider the employe question until the bidding was over. Bidding continued until Rutstein bid $1.325 million and Lemmon answered with a $1.4 million offer. Rutstein said the Landover firm would go as high as $1.375 million and asked Galgay to accept it because of the Maryland Giant's willingness to rehire employes.

Donald Seifman, who represented the Baltimore local of the United Food and Commercial Workers, made the same request. But Galgay, who queried every winning bidder on his attitude concerning former workers, said that hiring laid-off employes could be a factor only if the bids were equal. Rutstein declined to go higher than $1.375 million.

Curiously absent from the bidding today was Safeway Stores Inc., the California food chain that is, along with the Landover Giant, the major supermarket chain in the Washington area.

Safeway officials indicated Tuesday that they would make bids for some of the former Pantry Pride or Food Fair stores on the auction block. But 33 stores were auctioned today (although some were withdrawn by Pantry Pride because the bids were too low) without a bid from Safeway.

Pantry Pride refused to sell its lease on a store on Piney Branch Rd. in Silver Spring. The company wanted $450,000. The highest bid -- $100,000 -- came from Dart Drug.

Robert Cook, president of Cook's Supermarkets, bid $100,000 for the Laurel lease, which Pantry Pride representative Michael Swerdlow said was too low. The bankrupt chain wanted $400,000. But under prodding from Galgay, Cook raised his offer to $185,000 and Swerdlow accepted it.

On Thursday the bankruptcy court will auction leases on Pantry Pride stores in Capitol Heights and Bowie as well as other leases in Maryland and Delaware. Presumably, the company will make another shot at selling its Piney Branch Road lease.

Pantry Pride Enterprises Inc., formerly Food Fair, went bankrupt earlier this year and is selling off properties and leases to satisfy creditors. Swerdlow said the firm he owns has raised $350 million for Pantry Pride through similar auctions this year.